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Turkish company disqualified from tender to operate Israel’s Haifa port

Israeli intelligence agencies fear that a French-Lebanese company, associated with Turkish company Yilport, which is interested in operating the Haifa port, could be affiliated with Hezbollah.
Cargo ships are moored along a dock at the port of Haifa, Israel, June 24, 2021.

Israel’s government tender committee disqualified the Turkish company Yilport Holdings from participating in a tender to operate the port of Haifa, according to Feb. 14 reports in Israel, because of alleged affinity of its owners to a French Lebanese company suspected of ties with Hezbollah. 

Over the years, Israel has been confronted with problems both in the port of Haifa and Ashdod, because of the strong labor unions that controlled their operation. To solve this problem, and for other reasons as well, another port was built in Haifa. The new port, operated by a Chinese firm, has started to operate. The old port is undergoing a privatization process of being sold to an operating company. The tender in question concerns the privatization of the old Haifa port.

Several international and Israeli companies competed in the international tender that was posted, among them a group led by a Turkish company called Yilport, owned by Robert Yildirim, a Turkish businessman and friend of Turkish President Recep Tayyip Erdogan. The latter reportedly sent a letter of support for the company through his transportation minister to then-Israeli Transportation Minister Miri Regev. 

But Israeli security sources have made it difficult for the group to participate in the tender for reasons that were not stated. Yilport decided to forgo its control of the group — a consortium of several companies put together for the tender — that submitted to the tender and transferred it to the American company GraeStone. The Americans got a share of 51% of the group and the Turks were left with 25%, with another 20% going to an Israeli company and another Turkish maritime company holding 4%. 

Still, even after looking into the change, the tender committee was not convinced. It informed the group that it is considering disqualifying its participation in the tender, subject to a hearing. At the hearing, the group’s representatives showed that Yilport operates and holds 29 marine ports throughout the world, including close to NATO and US Navy bases, after they received security clearance to do so. 

Evidently, the explanations at the hearing did not help. As mentioned above, last week the government informed the conglomerates’ representatives that it was disqualified from participating in the tender. A letter sent to Eli Tilles, representative of the group in the privatization process, stated that it had been decided to end the participation of the group in the process "for security reasons and for reasons related to Israel's foreign relations." In addition, the letter read that due to concern for state security and foreign relations details could not be provided over the specific security considerations that led to this decision.

Israeli authorities refrained from entering into details, but these considerations were nonetheless reported at the beginning of the week. Apparently, the conglomerate was disqualified because Yilport’s owner, Yildirim, is closely connected to the CMA CGM Group, one of the largest shipping companies in the world. The founder and owner of CMA CGM is a Lebanese businessman named Jacques Saade, and it is managed by his son Rodolphe. CMA CGM operates the port of Beirut in Lebanon, where Hezbollah does as it pleases — and where the terrible explosion of Hezbollah’s ammonium nitrate stockpile occurred. More than 200 people were killed in the explosion and it caused enormous damage to buildings. 

Intelligence and public reports allegedly connect CMA CGM to senior Hezbollah officials and the activity of the Lebanese Shiite terror organization throughout the world. For instance, Lebanon’s Minister of Public Works and Transportation Ali Hamieh is affiliated with Hezbollah, and he is the one who gives work and operation permits to CMA CGM. The company also operates the Latakia port in Syria, which is used by cargo ships from Iran to transport weapons to Hezbollah. 

Similar intelligence information was provided by Israeli intelligence officials to the ministerial committee working on this issue as well as to the tender committee, and this information was the basis for the conglomerate’s disqualification. 

Yilport responded in a press release to the Turkish press, saying, “We have no connection to a terror organization; they blocked our opportunity to invest in the port. The company is mentioned, CMA CGM is a French company, and the French government even holds shares in it. This company operates in 52 ports around the world, including the Beirut and Latakia ports. The fact that the Hezbollah terror organization operates in Lebanon added a baseless connection between the company and Hezbollah. The claim is weak. Yilport never intervened in what’s happening in Syria or Lebanon. This is a political plot because we are apolitical and they are trying to make us out to be political. The Israeli companies have schemed to disqualify Yilport in the tender for the port of Haifa. In the name of Yildirim Holdings, we condemn the baseless accusations against us."

The disqualification of the Turkish group comes at a moment of possible rapprochement between the countries, and before President Isaac Herzog’s expected visit to Turkey in mid-March. But the Israeli decision to disqualify Yilport was not taken as a surprise in Turkey. Hay Eytan Cohen Yanarocak, an expert on Turkey at the Moshe Dayan Center at Tel Aviv University, told Al-Monitor, “Trust has not reached a level where Israel could allow a Turkish company to own a port.” However, he is optimistic. “This should not be an obstacle now. After normalization occurs, Turkish companies could participate in tenders,” he added.

Also related to this tender: 2½ months ago the Emirati giant port company DP World, which had vied for the tender in partnership with Israel Shipyards (Maspenot) headed by Shlomi Fogel, bowed out of the race. DP’s exit happened after a hearing was held with the participation of the director of the Finance Ministry, Ram Blinkov, during which it was made clear that it could not control the port in practice, again, for security reasons. 

It seems DP’s exit also had other reasons — geostrategic. At the end of  November, Emirati Crown Prince Mohammed bin Zayed Al Nahyan visited Turkey and met with Erdogan. After the surprising and well-publicized visit, the United Arab Emirates announced an investment of $10 billion in initiatives in Turkey.  A few days later, DP World announced it is bowing out of the tender for the Haifa port. Sources well versed in the process believe there is a close connection between these two events, and that DP World sought to clear the way for the Turkish Yilport and reduce competition between the two companies from these countries.